ERW patra pipe (41-60 OD) prices increased w-o-w in both Raipur and Mandi Gobindgarh despite slowdown in demand, mainly due to increasing raw material prices. However, prices dipped INR 100/tonne (t) d-o-d today in both Raipur and Mandi Gobindgarh.
Current steel prices are INR 43,400/t at Raipur and INR 45,400/t in Mandi Gobindgarh. Listed prices are ex-works (exw), excluding 18% GST.
Weekly and monthly averages:
Despite the daily dip, both locations reported higher average prices this week compared to last week.
Raipur: Weekly average prices rose to INR 43,400/t (up from INR 42,700/t). The monthly average also increased to INR 43,100/t (up from INR 42,500/t in February). Trade volumes of around 2,700 t were recorded for patra pipe in Raipur this week. Due to Holi festival trade activities remained low this week.
Mandi: Weekly average prices climbed to INR 45,400/t (up from INR 44,650/t). However, the monthly average remained relatively flat at INR 45,050/t. Trades in patra-based pipes were around 1,200 t this week.
Demand-price disconnect:
While demand for both finished and semi-finished steel improved last week, this week saw a slowdown. The festive period of Holi and rising prices likely discouraged buyers from accepting higher offers. This resulted in a significant drop in trade volumes. However, despite lower demand, pipe prices continued to climb w-o-w due to increasing raw material costs.
Raw material price impact:
Prices of key raw materials like hot-rolled strip (patra) and billets have increased significantly in both Raipur and Mandi compared to last week.
HR strip (patra) prices increased by INR 600/t w-o-w to INR 42,800/t exw Raipur as on 29 March compared to INR 42,200/t exw Raipur on 22 March. Similarly, patra prices in Mandi rose by INR 800/t w-o-w to INR 44,300/t as against INR 43,500/t a week ago.
Billet prices in Raipur have increased by around INR 350/t w-o-w to INR 40,000/t exw Raipur on 29 March compared to INR 39,650/t exw Raipur a week back. Moreover, billet in Mandi went up by INR 400/t w-o-w to INR 42,800 exw today compared to INR 42,400/t a week back.
Outlook:
ERW patra pipe prices are likely to remain firm in the near term despite slow demand. This is because of rising raw material costs, particularly prices of HR strips and billets. While there may be a slight daily fluctuation, weekly and monthly averages are expected to stay elevated. Trade activity, however, is likely to remain subdued until demand picks up.